Pegasus Gold, which pioneered many aspects of heap leaching in the United States, has decided not to participate in the Zaca gold property of Cali fornia Gold Mines. The pullout appears to be a major setback for California Gold which has vowed to develop the property itself after a proposed merger with Centurion Minerals of Vancouver.
California Gold President Richard Ketchen said Pegasus wanted to modify the joint venture agreement to make it more commercially attractive. Under the original agreement Pegasus would have funded all capital costs in exchange for a 50% interest.
Ketchen anticipates that production financing will be available after the merger in early March. In the past, the company has been unable to raise financing for the project on its own.
A detailed feasibility has been completed for the low grade property and major mine permits are on hand. The project is located 60 miles south of Reno, Nev., and an annual production rate of 37,000 oz is forecast.
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